Random House loses ebooks case

Random House, one of the world’s largest English language book publishers, has failed in an attempt to prevent an electronic publisher from distributing e-books by authors who had previously granted exclusive rights to Random House.

The dispute arose after the electronic publisher Rosetta Books contracted with several authors to publish certain of their works as e-books.  E-books are created by converting digitised text into a format readable by computer software.  The text can be viewed on an ordinary computer, personal digital assistant or dedicated e-book reading device and includes features such as electronic highlighting and bookmarking as well as word searching and dictionary functions.

Some of the authors who contracted with Rosetta Books, including William Styron and Kurt Vonnegut, had previously signed licences with Random House granting them the exclusive right to “print, publish and sell” their works in “book form”.

Notwithstanding these earlier agreements, Rosetta Books proceeded to advertise and sell books by authors contracted to Random House in e-book format.

Random House sought an injunction from the Southern District of New York District Court restraining Rosetta Books from selling the e-books, claiming that they infringed the copyright in the works licensed to Random House.  The court found that the contracts between Random House and the authors could not be interpreted as covering the right to publish e-books and, therefore, Random House was not entitled to being a claim for copyright infringement.

The court agreed with the Webster’s dictionary definition of a “book” as “a written or printed work usually on sheets of paper fastened or bound together within covers” and “form” as the “external appearance of a clearly defined area”.  This assisted the court in its conclusion that Random House did not own the right to publish the works as e-books.

The court also held that people who were cognisant of the customs, practices, usages and terminology as generally understood in the publishing trade would conclude that the licences did not cover e-books.

The judgment does not represent a complete victory for Rosetta Books and the case will go on to a full hearing some time in the future.  However, the decision will be seen as a blow to traditional book publishers and other rights exploiters in favour of those wishing to exploit works in the digital domain and, indirectly, the creators of those works.

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